|
By: Greg Koch Just over a month ago, I wrote a blog post that gained significant attention. Since then, multiple local businesses in Sioux Falls have closed, including some that had been part of our community for decades. This is truly sad news and highlights the urgency of my message. To be clear, I'm not begging for business; I'm asking to earn your business. I'm asking people to take the time to visit our stores and other local businesses, including our Downtown neighbors and friends at The Bridges. Despite the impact of my previous post, I was stunned to receive a donation request from a large, financially successful corporation for their fundraising campaign (I guess that viral post wasn't as viral as I thought). Additionally, I’ve received requests from animal shelters, youth sports teams, and various social service groups—all within one month. This is the norm for a small local business. Everyone wants a pound of flesh. The needs of our community don’t stop because business is struggling. As a local business owner and community member, I want to support every cause that approaches me, but we need to keep our donations with our chosen event partners and maximize our support to the organizations that have trusted us to support them. Believe me when I tell you when it comes to volunteering, donating, fundraising, and supporting this community we punch well above our weight class. 605 Running Company operates two locations, open 7 days a week from 9am-5pm and later on select days. Our products are available online with in-store pickup and shipping options. Through effective business deals, we’ve signed below-market-rate leases and efficiently balanced our staff and operating hours between both locations. We’ve also spent countless hours analyzing our inventory to keep our stock room tight and clean. We employ quality staff and pay them market rate or above. The armchair tropes simply don't wash here. We are doing everything we can to succeed in Sioux Falls. Our core values are transparent, reliable, and fun. While delivering fun has been challenging lately, we continue to strive for it. In the past two weeks, we offered three demo experiences with top brands Hoka, Altra, and ON Running, yet saw less than 25 participants in total. There was a time when over 100 participants would show up for a demo run. These experiences are free and often include swag, deals, clinics, classes and opportunities to try products without buying them. Simply put, we are not seeing engagement. I love this community, but the times have changed. It seems priorities have shifted and what we offer doesn't appeal like it used to. Unfortunately, more local businesses may have to close before the tide turns. This isn't an idle threat - check the local news and you'll see that local businesses are hurting. Just today, I got a note about a local boutique calling it quits. I believe, as it relates to our business, that this is a consumer choice matter. Our brands are seeing record sales (specifically, Hoka and Brooks, our top two brands), yet we are struggling to maintain profitability. This would indicate that consumers are choosing to purchase these products locally from a different source (box store, online outlet, or direct to consumer websites). We truly are the little guy taking on large corporations. I remind my managers and staff that there is no plan B for me personally. I’m doing everything within my capabilities to keep 605 Running Company open and thriving. These are the darkest hours of our business. We’ve enacted a scorched earth policy regarding future ordering, meaning fewer brands and less selection in styles and colors. We simply cannot afford to offer more merchandise that doesn’t get purchased locally at a decent margin. Even if we make it to 2025 the effects of this down year will be felt for the next 13-15 months in our shops. What makes us special isn’t the product; it’s the service and the people. What we have to offer is for everyone, not just runners. Your support is crucial now more than ever. We thank all our loyal customers for their continued support in July. It was a great month for cash flow, but our business still struggles to be profitable. We cannot sell at a discount and expect positive accounting results. Please keep sharing our message, like and subscribe to our social media channels (including YouTube), leave a positive review on Google, tell your friends about us, and shop local as often as you can. At the very least show up to the FREE things we offer so that we know that our community still has a beating heart. We can do this. There is light at the end of the tunnel for us. I'm always optimistic about what this community can do when challenged. Currently, we are seeing more folks shopping as we prepare to go back to school. My challenge is for you to give the local shops a chance to earn your dollars. A pair of shoes, a sweater, stationary, anything from a local store even the smallest purchase makes a huge difference. Thank you for your continued support.  605 Running was back in action helping serve the evening meal to the guests at St Francis House on the first Thursday of August! Always so enjoyable to help out. Thank you to Bev Soukup , Eva Gut and her boys, and Bruce Pollard . #run605
0 Comments
Dear Customers and Supporters,
Thank you for your incredible support throughout July. Your engagement with our articles and in-store visits has been heartening. However, we did experience days with one or fewer transactions at our Bridges location. While July was successful overall, we need to make some changes to ensure sustained growth and better serve you. New Store Hours Effective August 1st, 2024 To better manage our staff, optimize our budget, and extend our availability, we are updating our hours as follows: The Bridges:
Group Run Experiences We are shifting our focus from a regular schedule of group runs to hosting special group run experiences. This means you can look forward to events enhanced by product demos, registration events, special sales, and event promotions. These experiences aim to provide more value and excitement for our running community. Suspension of the Run605 App After much consideration, we have decided to suspend the Run605 app. While it was a unique way to connect with you, our data indicates it’s not being utilized enough to justify the cost. Rest assured, our rewards program will continue both in-store and online, and you will not lose any accumulated rewards points. Rewards points can be converted to gift cards on our website. Our website will remain a robust resource for connectivity and shopping. Ongoing Commitment to Community Events We continue to support our community with events like the 605 Trail Fest, 4.37 Community Run/Walk, Trick or Treat Trail Race, and the Gobble Wobble 10k. Our back-to-school programming is also in full swing, and we’re excited to keep timing local events throughout the region. How You Can Help Our retail business is the engine that drives our community support. Here’s how you can continue to support us:
Change is never easy, but we believe these adjustments will help us serve you better and continue growing. Thank you for your loyalty and support. Warm regards, Greg Koch 605 Running Company [email protected] 605-951-7982 By: Greg Koch
First and foremost, thank you for the overwhelming support for my last post. It wasn't easy to write, but the response has been incredibly humbling and supportive. I want to provide more details today because our business, and many other local businesses, need your sustained patronage. Here are a few points to expand on from my previous post, especially relevant as Amazon Prime Days approach. Supporting Local Businesses I would be willing to bet you've heard this phrase, “A rising tide lifts all boats.” My call to action is to give local businesses a chance to earn your dollars. At 605 Running Company, we know that running can be intimidating. Yet, the benefits of a healthy running community are vast. Did you know about seventy percent of people wear the wrong size shoe? The running shoe industry is huge, and even if you're not a runner, being well-fit for shoes is beneficial. This is why we exist. Additionally, some of the most popular brands in fashion got started in running (Hoka, ON, some brand with a famous logo ....) now is your chance to see the next trend and shop with us at 605 Running Company. During the pandemic, there was a strong push to support local businesses. Has this engagement faded in just a few short years? Early responses to my viral post suggest no. Many retailers have thanked me and reported an uptick in business due to the coverage. Shopping local stimulates economies and supports the American dream. Shopping local is a cultural shift that shapes a community. Online Shopping: The Local Alternative to Prime Days Yes, online shopping impacts markets, and the convenience of next-day delivery from giants like Amazon is undeniable. With Prime Days here, it's tempting to make purchases there, but I'd like to remind you that many local stores, including 605 Running Company, have robust online platforms that offer similar conveniences. You can shop our inventory and our vendors' products with options for in-store pickup or shipping. Supporting local businesses online still counts as shopping local (as long as you make those purchases on our sites). When you purchase from 605 Running Company’s online store, you support a local business that contributes to the community, rather than sending your dollars out of state or even out of the country. Here’s how shopping local online helps:
As a special thank you, we’re offering an online coupon worth 15% off purchases. Use the code "LOCAL" at checkout on shop.run605.com to save. Rent and Expenses Every business owner will tell you that rent is too high, but it's a part of doing business. Our top three expenses are rent, payroll, and cost of goods. We signed up for our rent because we believe in the value we offer. The point of my editorial is that not enough people are choosing to shop locally. Even the smallest purchases at local stores make a big impact. Politics My conversation is about choice—where we choose to spend our dollars. There's a place for politics, but not at the running store. After ten years in business we've operated under multiple administrations at every level of government. Truthfully it hasn't made much of a difference who is in office - retail business is hard work. Our retail struggles are not about politics but about community support. When folks choose to shop local, the entire community thrives. Isolation and Community Support In my previous writing, I shared feelings of isolation. Many local businesses feel the same. For those feeling isolated, The Helpline Center offers valuable resources, including the 988 number. You are not alone. Positive Outlook and Future Plans Customer Experience: We train our team to create a welcoming environment and offer solution-oriented service. To that point we are also working with Downtown Sioux Falls to create a unique secret shopper program. Our store recently was named a 2024 Best Running Store winner by The Running Event. This included a study on our wages, benefits, community support, and a national secret shopper program. We are committed to service. Community Events: Registration is open for the 605 Trail Race Festival. Soon, we'll open registration for our 4.37 Community Run supporting the 437 Project, our Trick or Treat Run supporting The Special Olympics of South Dakota, and the Gobble Wobble 10k supporting The Banquet. The Future: Our stores future remains uncertain. What I can tell our readers is that I personally don't have a Plan B other than 605 Running Company. That being said I cannot risk further financial hardship on my family to fulfill a business vision. These coming months are critical for our future and that means our sales have to be strong to survive. Because I'm not one to just call out problems I've got a list of action items every reader can partake in. Call to Action
This business and this community mean the world to me and to see both thrive is my goal. Sioux Falls is truly a great place to live and to work. I know times are difficult for a lot of folks. We are not looking for handouts, business advise, or marketing gurus. We just want the opportunity to sell you shoes, clothes and gear from great brands. Thank you for being part of our journey. Let's work together to ensure 605 Running Company remains a vibrant part of our community for years to come. By: Greg Koch
When I started at 605 Running Company, a dream was shared with me by The Watley Brothers. They cast a vision that was simply intoxicating. This business connected with me in such a way that it completely changed the trajectory of my career. The vision was as follows. Support the Community with Compassion and Expertise: We strive to be more than just a retail store; we aim to be a cornerstone of the community in Sioux Falls. Our goal is to provide not only top-quality products but also expert advice, support, and a welcoming environment for every health journey. Be a Vessel for Philanthropy: Giving back is at the heart of what we do. We are committed to supporting local charities, sponsoring community events, and using our platform to make a positive impact on Sioux Falls. Create Jobs and Provide Real-Life Experience: We believe in investing in people. By creating job opportunities, especially for young adults, we offer valuable real-world experience that helps shape future careers. Our commitment to staff development ensures our team provides exceptional service and grows within the community. As we approach our ten-year anniversary on July 14th, we find ourselves at a critical crossroads. This milestone is bittersweet; we celebrate a decade of serving the Sioux Falls community while facing the reality that our business is on the brink. Simply put, if we don’t improve sales, we will not be here. For years, we’ve been asked how business is going. Here’s the 2024 truth: Our retail business isn't making money. Despite our best efforts, our retail operations are struggling to turn a profit. We’ve strategized, tweaked, evolved, moved, added services, expanded, run promotions, and so much more. You name it, we’ve tried it to make our stores appealing to shoppers in Sioux Falls. We’ve had highs and lows, but retail has always been a challenge. Our ratings, reviews, and awards speak highly of the service we provide. Our team has attended additional training and coaching in every aspect of our business. We keep products in stock and available so that we can be solution-oriented when a customer walks in the door. Our goal has always been to listen to the needs of our customers and provide them with a solution today. It’s just all very hard. We face tough competition, and Sioux Falls is a saturated market. The bottom line is that not enough folks are shopping with us. We’re not getting enough foot traffic at either of our locations, especially at our new store The Bridges. Not only are we not hitting our growth goals, but we are down in sales compared to last year when we had just one store. Over the years, we have positioned our business in some of the highest traffic areas in town. Retail has always been a struggle, and it hasn’t mattered if we were on Phillips Avenue, Minnesota Avenue, or Western Avenue—sales have lagged everywhere that we’ve set up shop. We’ve added parking, remodeled, run sales, endured construction projects, put on races, and organized group runs. We’ve done it all. We’ve advertised on billboards, radio, social media, TV, Google, YouTube, magazines, and with posters around town. We’ve donated dollars, invested in others, and tried everything we can to stay afloat. Yet, for every dollar we earn, we spend three. While our coaching and events have been profitable at times, they haven’t been consistent or generated enough revenue to cover our retail operations. The low retail turn rate and insufficient margins are not enough. One side of the business can’t support itself and the other side of the operation. Addressing Common Misconceptions We Are Too Expensive: We don’t set our prices. We follow MAP (Minimum Advertised Pricing), an agreement with our vendors. The price you see at our shop is the same price from brands like Hoka, ON, New Balance, Saucony, Lululemon, and every other brand we carry. We even offer rewards programs and price match any advertised price for the same product. Shopping with us has its advantages, including personalized service and community support. Our Shop is Hard to Find or Isn’t Open: We have two stores, both with FREE parking. One is located in Downtown Sioux Falls and the other at 57th Street and Western Avenue, one of the busiest intersections in town. You can park right in front of either door. Additionally, both stores are open seven days a week, and we have a robust online presence, allowing you to shop with us 24/7, 365 days a year. We Don’t Have the Brands, Products, or Sizes You Want: While we might not offer every single brand available on the market, we do have a wide range of options including trail shoes, hydration gear, clothes, super shoes, track spikes, cross country spikes, daily trainers, walking shoes, gym shoes, and more. We have something for every lifestyle. Keeping up with product trends is nearly impossible, but our job is to have a solution that works. It might not be the up-to-the-minute option, but it works and can be bought from us. And when you buy our options, it helps our business. We can special order products and we value that option, but it isn’t as great as selling what we already have. Discounts and Return Policy: We match any advertised discounts or sales, including those for military, first responders, and medical personnel. Our return policy is excellent. We want you to swap products first to ensure you have the best experience. We also offer store credit and cash returns if needed. We are a service- and experience-oriented business built on relationships. We are here not just for today’s transaction but to support you on your health and wellness journey. Our Commitment One thing we’ve always prided ourselves on is recruiting and retaining our staff. Most of our crew have been with us for multiple years. We know our customers by name, and we’ve shared in countless journeys together. We regularly train on our customer service skills and study markets and trends. Additionally, we provide a first job experience for young adults in our community. As a community leader, I understand the importance of giving young people an opportunity to learn and grow. I studied education and spent eleven years working with youth at the Sioux Falls Family YMCA. Too often, the expectation for young people is unreasonable. We train our team well and provide them with opportunities to figure things out on their own, learning through doing, sometimes even knowing that they might not get everything right. We all make mistakes, but how we learn from them is critical. Showing grace in the workplace is essential for us. If things don’t change, it is time to imagine a 605 Running Company without a retail presence in Sioux Falls. When you read that, how does it make you feel? Would you miss our stores and the things we provide? That is the reality we are living in right now. A Personal Note As the Minority Owner of this business, believe me, this isn't the way I want to celebrate both my birthday and Independence Day. I'm proud to be an American, and I believe we live in a country that fully supports entrepreneurship, hard work, and capitalism. I'm not writing this post to ask for a handout. I take full responsibility for our business decisions. From the outside looking in, most people agree that we have done an admirable job in this community. From the inside looking out, we are drowning and isolated. The reality is we have not been self-seeking, we have not looked out for what is best for us as owners, we have given first when we had nothing to give. Our solutions have included longer working hours and more capital investment. Trust me we are well aware of how unhealthy that sounds. Our dream might not be sustainable long term unless we can change the tide. A Call to Action As we celebrate our ten-year anniversary, we’re reaching out to you, our community, to share this struggle and to ask for your support. If you believe in what we’ve been doing, if our presence has made a positive impact on your life or the community, please help us by shopping with us, spreading the word, and showing your support in any way you can. We want to continue serving Sioux Falls, but we need your help to keep going. I’m not asking for marketing tips, financing, or business advice. I just want you to let my team earn your business. The folks that work here are truly exceptional, and I believe in them. Experience what our fit process is all about. Try our products and trust us to journey with you through this adventure we call life. Let’s do it in comfortable athletic shoes and clothes, preferably. Thank you for being a part of our journey. Let's work together to ensure 605 Running Company remains a vibrant part of our community for years to come. Greg Koch - Owner - 605 Running Company
This weekend, The Bridges is closed because we are "short-staffed." While it's true that I wish we could maintain regular business hours, is 605 Running Company truly short-staffed, or are we just incredibly busy? Today, we timed a 5K in Harrisburg, timed a triathlon in Mitchell, hosted the 1st Saturday Group Run at The Cookie Jar, had a coach at a race in Viborg, and kept our Downtown store open. We describe our business as an ecosystem, but we are often judged solely by our sales, especially our weekend sales. This makes weekends like this one bittersweet. We want to serve our customers at our shops, but when the community is out being active, we need to meet them where they are. Unfortunately, this means not directly selling them shoes and gear all the time. Some days, I wonder if we have spread ourselves too thin. We offer coaching, race timing, manage races, have a race crew/team, and operate two stores. The bottom line is we can do so many things because of one thing: SALES. If I'm being honest, we need to make more sales. Sioux Falls is an incredibly saturated market for running shoes. Without much thought, I can name five stores not named 605 that sell the same products as us. Even with our record growth, this isn't a good formula for success. While I often claim to be a low-ego guy, in this area, I have a lot of pride. I'm confident that our sales floor team provides the best fitting experience in town for shoes and gear. We know that other businesses care about our community, and we strive to do our part by listening to and serving our community whenever opportunities arise. Take race timing, for example. Chip timing is a significant and valuable service, but it comes with its costs. You'd be shocked at our wireless bill. While we have some great races in town, we've noticed a decline in participants at many events in and around Sioux Falls. This decline is partly due to the pandemic and partly due to past business practices that may have left a negative impression. It's clear from my travels timing races across the state that our community has faced challenges. Unfortunately, this has affected everyone, and many events didn't survive. Still, some local races have opted to skip timing and just have a "fun run." While fun runs have their place, let's be real: timing is a critical component for a successful event. It provides accurate results, adds a competitive element, and enhances the overall experience for participants. Proper timing can attract more serious runners, boost participation numbers, and ensure the event's reputation for quality. That's why we entered the race timing business. It wasn't part of our original plan, and we didn't intend to become independent contractors timing races. It was a challenge presented to us, and after years of requests, we eased our way into the timing game. I'll be the first to admit that we're not perfect, but we get better with each event. We've been running the timing business on a shoestring budget, but it's growing, and we're excited about the future possibilities. However, we need community support to continue growing. Some of the largest events in the area contract timers from out-of-state, and despite being local, we've never had the opportunity to bid for some of the bigger races. I'm working tirelessly to change this, but it's challenging. Let's shift gears. We listen to our customers and take risks to provide solutions. For example, when we moved to our current downtown location, which includes parking, more space, and more event opportunities, it was a risk that has proven beneficial. However, some of our audience isn't satisfied with downtown and let us know through our customer survey. In March, we opened a second location at The Bridges, off I-229 and in the premier Western Avenue corridor. Many folks praised this move, but it has been slow to yield results. It's a high-risk venture that depends on customers buying products exclusively from 605 Running Company. We pride ourselves on offering exceptional service, and our prices are competitive with other retailers because our brands set the prices through dealer agreements. We understand that some perceive us as expensive, but we assure you that you’re getting the best value with the expertise and personalized service we provide. Our team is dedicated to ensuring you find the perfect fit and the right gear for your needs, and we believe this sets us apart in the market. We believe in the quality of our coaching, retail, timing, event management, and philanthropic efforts. However, my team and I are reaching our limits, and our sales are not enough to sustain our community initiatives. It's not just about being short-staffed; it's about being stretched too thin. As the leader, I am fully committed to nurturing and growing our ecosystem, but we need your support to continue this journey. If you believe in what we're doing and want to support our mission, consider choosing 605 Running Company for your running needs. Every purchase helps us continue improving our community every single day. Thank you for being part of our journey. |
|
RSS Feed